Under what circumstances can Burros Fries terminate the franchise agreement without allowing the franchisee an opportunity to cure the breach?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
The Franchisee shall maintain the Business in accordance with the provisions and requirements of Section 12 hereof, and must secure a lease that has been approved by us (as described in Section 12.S) within eighteen (18) months of the execution of this Franchise Agreement ("Effective Date") and open the Business for operation (the "Opening") within twenty-four (24) months from the date of execution of this Franchise Agreement. Upon Franchisee's failure to meet either of the above requirements; then we may, at our sole discretion, terminate the Franchise and this Agreement and retain all fees paid by Franchisee, without breach of this Agreement by us as specified in Section 23.C. The Opening requires that Franchisee has qualified for and has obtained all necessary licenses and permits needed to sell Products and perform Services. We may, in our discretion, grant Franchisee one sixty (60) day extension past the allotted time within which to secure a lease and/or open the Business.
During the term of this Agreement, the Accepted Location shall be used exclusively for the purpose of operating a Franchised Business and shall be located within the Territory. In the event the Business shall be damaged or destroyed by fire or other casualty, or be required to be repaired, Franchisee shall commence the required repair of the Business within thirty (30) days from the date of such casualty or notice of such governmental requirement (or such lesser period as shall be designated by such governmental requirement), and shall complete all required repairs as soon as possible thereafter, in continuity, but in no event later than ninety (90) days from the date of such casualty or requirement of such governmental notice. The minimum acceptable appearance for the refurbished Business will be that which existed just prior to the casualty; however, every effort should be made to have the refurbished Business include the then-current image, design and specifications of a Burros & Fries Business.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
Based on the 2024 Burros Fries Franchise Disclosure Document, the franchisor can terminate the agreement if the franchisee fails to meet specific deadlines related to opening the business. Specifically, the franchisee must secure a lease approved by Burros Fries within 18 months of the franchise agreement's effective date and open the business within 24 months of the same date.
According to the FDD, if the franchisee fails to meet either of these deadlines, Burros Fries has the discretion to terminate the franchise agreement. In this case, Burros Fries can retain all fees paid by the franchisee without being considered in breach of the agreement. However, Burros Fries may grant a single 60-day extension for securing a lease or opening the business.
Additionally, if the Burros Fries business is damaged or destroyed by fire or another casualty, the franchisee must begin repairs within 30 days of the incident or notice from a governmental requirement. All repairs must be completed as soon as possible, but no later than 90 days from the date of the casualty or governmental notice. Failure to adhere to this timeline may also result in termination without an opportunity to cure.